SIMA hails hike in customs duty on imported polyester fabric

Coimbatore: Southern India Mills Association (SIMA) today thanked the Union finance and textile ministers and GST council for increasing the basic Customs duty on imported polyester fabrics from 10 per cent to 20 per cent.

Since man-made fibre price in India cost 20 to 30 per cent more due to high incidence of duties and levies, there was a threat of cheaper imports especially from countries like China, SIMA chairman P Natarajan said in a statement.

The increase in basic Customs duty would reduce imports, he said adding that there was a need to increase the import duty on cotton fabric also on par with polyester fabric in the interest of powerloom and handloom sectors to sustain their competitiveness.

Consequent to the scrapping of four per cent additional duty and levy of five per cent of GST on polyester fabric, the imported polyester fabric attracted 10 per cent basic Customs duty and five per cent IGST.

Therefore, there was a significant drop in the import duty threatening the survival of the domestic manufacturing industry due to cheaper imports especially from countries like China.

Thus, the industry had represented to the Centre and the GST Council to increase the basic Customs duty on fabrics to retain the competitiveness of the domestic manufacturing industry, Natarajan said.